Reward

Recognising employee performance is likely to give them an expectation of some sort of reward.  This should not be a surprise, as the methodology will be already known as part of the motivation for them to give you enhanced performance in the first place.

1. Ensure employees are aware that good performance will be rewarded and less than good will not.  If this is a new area for your company you will quickly realise that good frequently has to be split further into very good as well as good.

2. The level of reward has no template.  Each industry will be aware of “the norm” and that might lead you to consider a particular way of delivering this reward.  There are many specialists around who will advise you what is appropriate.

3. The rule of thumb is to ensure any reward, typically bonus, is paid out of profits generated by enhanced individual performance.  Having said that if an individual performs at a very good level but

the company does not make a profit, your dilemma is to either not pay a bonus and demotivate what is a key employee, or pay a bonus and add to the lack of profitability.

4. Therefore a fundamental aspect of any reward scheme is to look after your key employees.

Retain

1. Your key employees will be those who are consistently enhancing the performance of the company, which typically leads to enhanced profitability.

2. Companies that treat all employees the same and fail to differentiate between those that perform and those that don’t will never become truly successful companies.